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Sale of Bunnings O’Connor adds to Orchard’s harvest for 2008
30 July 2008
Orchard Funds Management (Orchard) today confirmed it had exchanged contracts for the sale of a bulky goods property in O’Connor, WA for $12.8 million. The property was originally purchased by the Orchard Diversified Property Fund (the Fund) in 2003 for $10.75 million.
Located on the intersection of South and Yarrick Streets, the property consists of 2.4461 hectares with a net lettable area (NLA) of 7,656 sqm. Originally constructed for BBC Hardware, it is now fully leased to Bunnings Warehouse on a lease expiring in 2011.
Commenting on the sale, Orchard’s CEO David Hinde said “This latest sale again demonstrates Orchard’s ability to actively participate and achieve positive outcomes for investors in the current market.
2008 has proven to be a challenging year for many, with a demonstrated lack of transactions in the market. However, with the sale of Bunnings O’Connor we are pleased to report the Fund has now transacted over $50 million worth of property this year. These funds have been applied to debt.”
Over the course of 2008, the Fund has announced a number of targeted divestments including the sale of Boundary Hotel, East Bentleigh, VIC for $17 million; Normanby Road, South Melbourne, VIC for $10.35 million; 3 Wellington Street, St Kilda, VIC for $10.01 million; and now Bunnings O’Connor for $12.8 million.
Orchard reports its key focus continues to be on managing the Fund to ensure it is well placed to take advantage of once-in-a-cycle opportunities. At the Fund level, this includes making realisations of selective property assets, like Bunnings O’Connor, as part of its targeted divestment program which commenced in July 2007.
The sale is being managed by James Condon of Savills.